Mergers and acquisitions Tips: for success in New York business transactions

Mergers and acquisitions and other business transactions can help ensure the financial success of your business. These tips can help better ensure these transactions are favorable.

Ensuring your business's financial well being can require a proactive approach. In some instances, this means moving forward with a merger and acquisition transaction. Although this type of business evolution can be risky, the following tips can help mitigate the risks and increase the odds of a more successful outcome.

Tips to increase the odds of a successful transaction

Entrepreneurs considering a merger and acquisitions transaction should consider the following:

  • Do you have a plan? Arguably, one of the first steps to help better ensure a positive outcome when moving forward with this type of transaction is to determine the end goal. Is this transaction designed to help diversify the company? Eliminate competition? Help the company grow? Whatever the reason, whenever possible it is important to come up with a few options to reach this goal. Review the companies that may be available for the transaction and set up a plan to move forward.
  • Is your due diligence sufficient? When acquiring or merging with a business, take the time to carefully review the company's business operations and finances. This can include reviewing the Articles of Incorporation, Bylaws, minute book, organizational chart and other documents to make sure the proposed acquisition is in good standing. Also review financial documents like Auditor's Reports and a listing of all physical assets. It is wise to review the list of employees, benefits, salaries, any contracts the targeted business may have as well as potential tax issues. These are just a few of the many considerations to review before moving forward with the transaction.
  • Do you have a set price? Do you know your limit? Once you've decided to move forward with the transaction, have a specific purchasing plan in mind. Know what price you are willing to offer and what your upper limit is. Be prepared to walk away if the negotiations led to a purchase price over your upper limit.

Putting together a strategy to meet your company's needs and crafting contracts and other legal documents to help protect your business can be an arduous process. As a result, those considering moving forward with a merger, acquisition or other business transaction are wise to seek the counsel of an experienced commercial and corporate transaction attorney. Your attorney can assist in create goals, assessing and mitigating risks as well as tailoring contracts for your specific needs to better ensure a more favorable outcome.

Keywords: business law mergers & acquisitions